Senate Foreign Affairs, Defence and Trade Legislation Committee, , 2:41:38 to 2:48:36
Senator Shoebridge questions the government's refusal to release the Valdez report concerning the Collins class submarine Life of Type Extension (LOTE) project.
Topics: National security, Procurement
Speakers: David Shoebridge, John Chandler, Mark Hammond, Meghan Quinn, Hon Murray Watt, Raff Ciccone
>> Okay. Uh Senator Schub,
Secretary, the committee was provided this morning at I think about 7:00 a.m. a public interest immunity claim objecting to the production of the Valdez report, which was the independent insurance activity report into the LO scheme to extend the life of the Collins class submarines. uh, why was it only provided at 7:00 a.m. this morning given the request for the Valdez report is now not one month or two months or 3 months or four months, but I think last time I checked at least 6 months outstanding.
>> Uh, that's a matter for the minister and his staff.
>> Minister,
>> uh, I'll have to take that on notice.
>> um the Valdez report has been provided to the audit office um and the audit office has um as a result of that included multiple references um to the Valdez report in the Collins class submarines life of type extension audit report in 25 to 26. Um minister, yet your government is refusing to provide a copy of this report um to this oversight committee. Why is that?
>> Again, Senator, I'll have to take that on notice. >> I mean, I I I presume that the letter provided some information on that. I haven't seen that letter, but I presume that it it um
>> um the the minister says, well, I'm happy for you to I mean, it came from your own minister, but I'm happy for you to have a copy. Um the the letter says uh I have determined it's appropriate to maintain a public interest immunity claim over the Valdez report as the disclosure of this information would likely prejudice national security objectives of the Commonwealth in maintaining these claims for public interest immunity. I have balanced the competing public interest for and against disclosure and I'm satisfied that the public interest against disclosure of the Valdez report outweighs the public interest in
is clearly the reason that the report is not being provided, the the impact on national security matters.
>> Um, this is a report into the uh now failed, wildly over budget, wildly um out of um now um overtime um failing LO project that you were repeatedly given notice of the the the the potential failures in this LO project. Admiral Hammond, in your role previously um in in the Navy um uh it appears that the Valdez report from public reporting says that there's a lack of adequate skills and competency. There's a bunch of unknowns in the engineering. These are all things that were known to you for years um in your role inside the Navy, Admiral Hammond. Um do you support the minister's decision not to let the parliament see
this? Uh Senator, I refer you to my earlier testimony on this. We have been over this over the last few years. Uh and I reject your characterization of a failed project which only really commenced uh when HMAS Funkam arrived in Adelaide. So that the project has been rescoped. It has been subject to significant analysis as we've uh previously discussed in this committee. Um the government's decision with respect to um PII claim is entirely up
to them. Well, why don't we go use go to the LO project? How much has been spent on it to date?
>> Uh s I'll call the the relevant officials to the table. It would be Mr. Hanley and Vice Admiral Buckley and probably um uh first assistant secretary submarines John Chandler as well.
>> And and while they're coming up um um HMAS Farum is the first uh of the Collins class subs to be going through the LO project. Is that right? That is
that is correct.
>> And when did that commence?
>> Uh I'll refer to the official Senator.
>> So the first question is how much has been spent on LO to date? Uh Senator
John Chandler, first assistant secretary submarines. So uh the amount spent on the load project to date uh is approximately $680 million. All right.
Uh, >> and what have we got for that $680 million? How many submarines um have had their life of type extension done?
>> So, Senator, um, the life of type extension of the Collins class, uh, and this is previous testimony repeating, uh, involves the LO project integrated with effective ongoing sustainment and selected capability upgrades.
>> So, so just what have we got for $680 million? What improvements have been physically put on any submarine for $680 million?
>> Okay, Senator, uh to date, no improvements have been physically put on any submarines, but what we have is uh we we are procuring the long lead items for the propulsion systems, the the um diesel generators and so on. And we have uh developed designs to install those in the submarines at a time to be decided.
You see, Admiral, this is defense procurement all over. The public has spent $680 million on the LO project. The purpose of the LO project is not to uh employ foreign admirals. It's not to uh uh you know increase the size of the defense um bureaucracy. It's not to write reports. The purpose of the LO project, as I understood it, was to extend the life of the existing Collins class submarines. And we've just had evidence from Mr. Jen, quite frank evidence, that we're $680 million in the whole and not a single thing has been done to extend the life of the Collins class submarines. Not a single physical thing has been done to extend the life of Collins class submarines. How How did we get here,
>> Senator Shoebridge. Admiral, >> Senator Shoebridge, that is not the evidence that I heard. I heard from the official talking about the necessary uh requirements as part of an extension of this nature to do pre-orders uh to design to do the engineering uh capability assessments etc. in advance of physically physically installing
thing has been installed on a submarine. No rust has been cut out. No painting has been done. No engineering has been done. 600 for under the lot project. >> But $680 million in the hole. This is like defense all over, isn't it?